I have posted about outsourcing in MA in past posts here and here.
Today’s topic is focused on the virtual MA organization – an organization that outsources all or almost all of its key functions. Given the capabilities of service providers, it is entirely feasible to outsource every sub-function within MA, including medical communications, grants management, medical information, standard and specialty field forces / MSL groups.
My goal today is not to discuss the pros and cons of a decision to form a virtual MA organization but instead to discuss some key aspects to making a virtual MA organization successful. Although today’s post is looking at a fully virtual MA, the key points would be just as relevant for a mixed virtual and internal MA organization.
Reality of Virtual MA Organizations
Most organizations that decide to use virtual MA are organizations where very little MA infrastructure exists. Either they are small organizations building their first MA function or they are mid-sized organizations that are going into a new TA. Regardless of situation, the analysis that leads to a virtual MA organization is usually a buy vs. build decision. When considering how to make virtual MA successful, we need to start at that point.
Keys to Success
There are three keys to success to managing a virtual MA organization:
- Upfront Expectations
- Sufficient Internal Management Resources
- Structured System for Evaluations
In order for the virtual MA organization to be successful, the vendors that provide the services need to have a clear understanding of what is expected of them and when so that they can develop the correct scope of the work for their pricing. Defining what is expected of the vendor is easier in some cases, like for Medical Information defining expectations about call wait time and speed of fulfillment. But, defining expectations is much harder in cases like an MSL group or a specialty education group. This challenge is heightened by the fact that the reason some organization’s decided to go virtual is that they don’t have a lot of expertise in house.
Nevertheless, it is vital that a clear set of expectations and measures are agreed upon as a part of the vendor selection and contracting process. There is no point in the process where the company has more control than at the point of contracting. If clear expectations are set, both sides win because the vendor can appropriately staff and manage the group and the company can achieve their goals. If not, the vendor may either need to increase the scope during the contract or simply fail to achieve some needed result and the company will face unexpected costs and missed expectations.
In order to set the right expectations a strategy for MA’s work for the next period must be developed in detail. And this strategy should be developed before the vendor selection process occurs to ensure that the vendors are supporting the strategy not the strategy supporting the vendors.
WARNING: Some vendors in our industry will encourage buyers against doing this work in advance. The vendors will tell the buyers that the vendor will develop these expectations after the contract is signed and/or after they are active. Companies that take this approach usually end up spending much more than they expected and achieving less results than they expected.
Sufficient Internal Management Resources
Virtual does not mean management free. While the vendors will definitely have their own managers, successful virtual MA organizations have learned that they need to closely manage the vendors to achieve expected results.
Given the situation that leads to a virtual MA organization as discussed above, it sometimes comes as a shock to those setting up one that they still need to hire. And those hires need to be managerial-level staff.
A general rule of thumb is the greater the range of responsibilities and lack of clarity, the greater the need for management. So, for example, outsourcing a MedInfo group, with clear metrics and expected volumes, might require only a ¼ Associate Director. But managing an outsourced MSL group during launch, even if there is a clear expectations set up-front, would require a ½ time director to deal with the unexpected and new learnings from the healthcare community.
If the company is unwilling to invest in the resources needed to manage the virtual MA vendors, that is a sign that the value of MA is not really understood within the organization. Unless that core issue is addressed it is unlikely that the virtual MA group will be successful.
Structured System for Evaluations
In addition to being actively managed, virtual MA vendors need to be on a half yearly or yearly structured evaluation process. The structured process will force a review of the original goals and scope of the relationship and provide an opportunity to resolve ongoing issues. Without a structured process for reviews, problems tend to fester and eventually result in a complete breakdown of the relationship.
Many companies entering into a virtual MA environment rely on the vendors to suggest the structures of these types of meeting. I would recommend that the company own the process and set the agenda. This will ensure that those issues most important to the company serve as the focus of the process as opposed to an add on. It also avoids the “make the case for added scope” that many vendor-driven processes tend to become.
Do you have experience setting up or managing a wholly or partially virtual MA organization? What would you recommend? Please leave a comment or send me a message.